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Haven’t upgraded to online timesheets? Think your company is too small? You might not realize how much paper timesheets are costing you. And it’s not just money. Manual time tracking makes you less efficient at running your business.

Key Considerations When Thinking About Online Timesheets

  • Is your current system accurate, or do you sometimes overpay/underpay employees?
  • If you were audited, could you produce timesheets for the past three years?
  • How long does it take you to process payroll?
  • Do you pay one of your employees to prepare timecards?
  • Is unplanned overtime inflating your labor costs or impacting cash flow?
  • Do you calculate Paid Time Off (PTO) with spreadsheets?
  • Do you want 24/7 mobile access to timecard data?

Here are 7 critical reasons why you need online timesheets, even if you are a small business.

1. Collect Employee Time Data Whenever they Work, Wherever They Are

If you are already using business apps, you know how handy they are. Online timesheet apps are designed for small screens. Employee timekeeping is a foundational business process. Remember, online timesheet apps are employee-facing as well. Your employees can see their schedule, timesheet, and PTO accruals on their phone. Plus, many systems allow your employees to request time off.

When you can see online timesheets at a glance, you can prevent problems. Avoid shift coverage gaps. Optimize labor allocation among ongoing projects. Know where your mobile employees are throughout the day. Eliminate the back-and-forth texting when someone is confused about the schedule.

2. Track Time by Project, Department, Location, Position

Do you need to track the projects your employees are on? Do they get paid a different rate for different jobs? You can do this the hard way or the easy way. If your employees have to manually track hours by different categories, it gets confusing—and inaccurate fast. Thankfully there are online timesheet apps that solve this problem.

Online timesheet apps like TimeWorksPlus let employees select project or other details needed. If employees work from home, you get a record of that. Hours are automatically calculated, making timecard approval and payroll processing so much easier!

3. Protect Yourself against Employee Time Theft and Wage Theft Claims

If your employees report hours on an ‘honor system’ you are at risk for time theft. You might trust your team. Hopefully they are worthy of your trust. But employers who are too trusting can be cheated. Successful businesses ensure employee accountability in all aspects of their jobs. Why even open yourself up to time theft?

Wage theft can feel even more insidious. If you ask employees to record their time manually, they are bound to make errors. You don’t know whether those mistakes are in your favor or theirs. Neither do they. This can lead to concerns about fairness and erode teamwork. You might worry that you are not paying your employees for all the time they work. They might worry about that too…and take you to court with a wage theft claim.

Paper timesheets are simply too vulnerable to hours padding and buddy punching. They are also at risk of time shaving and forgetfulness. Many employers who switch to turnkey online timesheets are surprised by the drop in hours. It’s interesting how automated time tracking puts an end to early clock ins and other sources of time creep.

4. Comply with Fair Labor Standards Act (FLSA) Recordkeeping Laws

Employee time theft isn’t the only thing to worry about. Without accurate employee hours recorded through a secure system, you are on shaky compliance ground. Employers are required under the Fair Labor Standards Act (FLSA) to record hours worked each day and each workweek. In addition, employers must report total straight time and total overtime to each workweek.

Retool, Retrench, and Rebuild Framework

Were you forced to move employees offsite due to lockdown or shelter in place orders? Inexpensive time tracking apps can help you mitigate pandemic-induced business disruption. Whether you plan to keep staff at home or move them back to the office in phases, take advantage of apps that are designed specifically to overcome the inherent challenges of remote work policies. Plus, they also help you manage onsite employees.


Employers must calculate these figures for each employee. And they must keep records for at least the previous 3 years. Can you produce records for each employee going back 3 years?

There are hundreds of free or low-cost online timesheet options. Why risk a costly fine with sub-par recordkeeping? The Department of Labor (DOL) audits hundreds of SMBs every year. Even if you have a small staff, you could be audited.

5. Reduce Payroll Processing Time

Let’s talk about payroll. With paper timesheets, you spend time fixing inaccuracies. You chase down missing information. You convert hours and minutes to fractions in preparation for payroll. Then you manually enter the data into the payroll system.

When you can approve timesheets in minutes, payroll processing time is slashed. Online timesheets are filled in each shift. Conversion to fractional time is automatic. You can review and catch errors almost as they occur, virtually eliminating costly payroll errors. At the end of the work period, payroll approval is fast and easy. You save time and everyone receives their proper pay.

Now consider this: what is the value of the time saved? What revenue-generating activities could you pursue? Clearly, there is an opportunity cost of time spent processing payroll.

Perhaps you pay one of your employees to approve timecards. If so, the same principles apply. You are paying them a wage. Plus, there is the opportunity cost.

6. Control Overtime

If you have hourly employees, overtime can be an issue. Manual systems don’t have built-in alerts to notify you when someone is approaching overtime. The larger your company, the more unplanned overtime costs you. The smaller the company, the bigger the impact of unplanned overtime can feel. Some online timesheet apps have overtime settings. Reducing overtime hours is one of the easiest ways to shrink your labor costs.

7. Automate PTO Tracking

If you offer PTO (Paid Time Off), I’m sure you understand how important it is to your employees. Calculating PTO can be time-consuming with spreadsheets. If PTO is not tracked correctly, you can be sure your employees will notice. If you haven’t made a PTO mistake yet with spreadsheets, trust us, you will eventually. Online timesheet apps track accruals automatically. That’s one more thing you can take off your plate.

Manually handling time off requests can be costly as well. If employees have to hand in a PTO request form, or send an email request, there’s a good chance the time-off request will get lost. And what happens when requests overlap? Or what if you can only grant some of the days requested? Who gets priority? Manual PTO processing is costly in time and morale.

Online PTO tracking can also manage government-mandated categories of leave. Tracking these categories manually can be a nightmare. With online tracking, it is easier to follow the rules. And it is easier to prove that you did.

Began writing at age seven and never stopped. Devoted decades to content strategy, communications and digital media. Dabbler in all things, including cycling, piano, ukulele, and art.
Kari Johnson